The role of university venture funds in supporting early-stage Japanese startups

Abstract

This thesis explores how university venture funds in Japan are uniquely positioned to turn the country’s innovation capacity into entrepreneurial capacity by supporting early-stage startups. While Japan consistently ranks high in research output, much of this potential is not being translated into successful entrepreneurship. Risk capital is scarce compared to other ecosystems, particularly for deep tech, and support systems for early-stage startups are still limited. University venture funds – which inherently connect universities, entrepreneurs, and risk capital – are well positioned to bridge this gap. Yet despite their growing relevance, their evolving role in supporting Japanese early-stage startups is understudied.

This study compares university venture funds with different profiles – ranging from leading and longstanding funds like UTEC, to public-private venture funds established through government initiatives, to recent funds with diversified structures – analyzing how they are structured, how they invest, and what results they have seen so far. It then builds on startup examples and interviews with university venture funds to identify how these funds can better support early-stage startups through improved fund operations, stronger pre-seed support, as well as a strategic approach to growth and exits. Ultimately, this thesis advocates for actionable solutions informed by global practices but adapted to Japan’s unique startup ecosystem.